The Australian ginger industry - Department of Primary Industries

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Processing capacity Buderim Ginger has the capacity to process over 6000 tonnes of raw ginger per annum; however, current storage capacity restricts processing capability to just over 3000 tonnes per year for early harvest ginger. The quota arrangement A quota arrangement is in place between Buderim Ginger and ginger growers. The quota arrangement refers to a tonnage system whereby the grower has access to a market to supply a set volume that is agreed upon by both parties. Growers that supply Buderim Ginger receive a guaranteed price for the tonnage that they produce, providing it is accepted by the factory. There are currently 20 registered quota holders in Queensland with a quota capacity totalling 3176 tonnes, of which approximately 15 growers are currently supplying quota to Buderim Ginger. The number of quota holders has decreased since 2000, when 25 registered growers owned and supplied quota. From 2002 to 2007, the set price for quota equalled $1.10 per kilogram. In 2008, the set price increased by two cents to $1.12 per kilogram. Further increases have been negotiated and the set price will continue to increase by two cents each year until 2010. Each year Buderim Ginger conducts forecasts for raw ginger requirements and informs quota holders of the percentage of quota they are required to supply to the factory in the following season. All ginger growers who supply the factory have entered into long-term contracts with the company. This gives the company a secure source of ginger and the growers a guaranteed market for their ginger quota. The company holds some base quota, which is available to lease to potential growers in order to encourage new entrants on a small initial scale. In recent years a growing number of smaller and medium-sized growers have significantly decreased or completely ceased production. Where smaller growers have left the industry, larger growers have expanded their production operations—purchasing quota from those holders leaving the industry. Five growers currently lease quota from registered quota holders that are not fulfilling their quota requirement. These growers each have their own individual arrangements in place for leasing quota. Buderim Ginger has suffered from a lack of local raw ginger supply in recent years, as many local producers have been unable to satisfy the quota requirements of the factory. As the number of quota holders supplying ginger to the factory has declined since 2000, the factory has requested growers supply volumes that exceed their quota allocation. Despite this, Buderim continues to experience problems with securing a sufficient supply of raw ginger from domestic producers. Buderim Ginger indicated the need to identify new areas to grow ginger in order to maintain a sustainable supply of raw ginger in the future. The Bundaberg and Atherton regions have been identified as possible locations where ginger production could be successful. A number of growers from the Bundaberg area have and will continue to supply ginger; however, volumes at this time remain relatively low. There is no active ginger production taking place at Atherton. Further research and supply experience in ginger production in these regions is required. Domestic and international markets Buderim Ginger has a strong export focus, with 60% of product manufactured being exported into foreign markets. Key export markets include the United Kingdom, Germany, Holland, Canada, the United States, New Zealand and South Korea. Products supplied to these markets are mostly ingredient-based for use by confectioners, bakers and other food manufacturers. The remaining 40% share is dedicated to the domestic market where product is distributed to retail supermarkets (Coles and Woolworths) and the food service and industrial sectors (Darrel Lea and Cotties). The Australian ginger industry Overview of market trends and opportunities 25
26 Through product development and effective marketing and product positioning, Buderim Ginger predict a steady growth in demand for their product range in the future. While there is limited opportunity in further developing the domestic market for sugar-preserved ginger products as it is already mature, the company has indicated that there is a strong opportunity for accelerated growth in exports of ginger purees and ingredients, particularly by profiling and promoting their products to potential buyers at international trade events. In export markets, Buderim Ginger’s product range is differentiated by flavour, consistency and the clean and green image of Australian-grown ginger. Buderim Ginger has established a strong reputation in overseas markets through brand recognition, with many customers using Buderim Ginger’s brand, and therefore have a competitive branding advantage over other ginger products. Price competitiveness is the main factor limiting demand, due to alternative suppliers being mainly from low–labour cost countries such as China and Thailand. In recent years, Buderim Ginger has placed a strong focus on product improvement and development. A range of pharmaceutical and nutraceutical products are currently under development, with extensive research being conducted into the health benefits of ginger and its use in combating various medical conditions. Buderim Ginger also indicated the desire to work with new varieties of ginger and further exploit opportunities with existing varieties such as Buderim Gold. 4.1.2 Bundaberg Brewed Drinks Pty Ltd Background Bundaberg Brewed Drinks Pty Ltd, established in Bundaberg in 1960, is an Australian, family-owned, boutique brewery that has built its success and reputation on providing high-quality, distinctive brewed beverages to domestic and international markets. Products manufactured The company produces and exports Bundaberg Ginger Beer. In addition to ginger beer, Bundaberg Brewed Drinks manufactures lemon lime and bitters, fruit flavoured ales, sarsaparilla and cordials in various packaging. Bundaberg Brewed Drinks’ production includes traditional brewing processes, but the final product is non-alcoholic. Sourcing raw ginger for processing Bundaberg Brewed Drinks uses ‘Queensland’ ginger for manufacturing ginger beverages. Australian-grown ginger, characterised by its distinct flavour profile and high quality, is the preferred source of raw material for the beverage manufacturer. All raw ginger is purchased from Buderim Ginger Limited in its semi-processed form. Production capacity Bundaberg Brewed Drinks currently has the capacity to further expand production, and is interested in establishing the Bundaberg region as a second ginger growing area and supporting the growth of the ginger industry. Domestic and international markets Bundaberg Brewed Drinks is well established in the domestic market, with major supermarket chains and wholesalers distributing their product range to end users. However, with limited growth potential in the domestic market, the company remains focused upon accelerating growth in new and existing export markets. Bundaberg Ginger Beer is a market leader in both Australia and New Zealand, and is now gaining recognition in a wide range of other countries across the globe including the United Kingdom, Europe, Singapore and Hong Kong. The company has continued to boast impressive export growth in recent years with an increase in export sales of 41% from 2004 to 2007. The Australian ginger industry Overview of market trends and opportunities
Page 1 and 2: The Australian ginger industry Over
Page 3 and 4: Contents Tables and figures v Prefa
Page 5 and 6: 5.3.1 Seasonality 31 5.3.2 Competit
Page 7 and 8: Tables and Figures Tables Table 1:
Page 9 and 10: Executive summary This report prese
Page 11 and 12: • Availability of good-quality se
Page 13 and 14: 2 2.0 Global situation analysis 2.1
Page 15 and 16: 4 Figure 4: Global leaders in ginge
Page 17 and 18: 6 Figure 7: Leading producers by yi
Page 19 and 20: 8 Figure 9: Volume of ginger export
Page 21 and 22: 10 Figure 11: Main ginger productio
Page 23 and 24: 12 3.4.3 Land, water and irrigation
Page 25 and 26: 14 Table 2: Harvesting periods for
Page 27 and 28: 16 3.5 Ginger production for the pr
Page 29 and 30: 18 3.6.3 Supply and demand Supply o
Page 31 and 32: 20 Trends in ginger production for
Page 33 and 34: 22 3.8.2 Key issues affecting produ
Page 35: 24 4.0 Australian ginger processing
Page 39 and 40: 28 4.2 Exports of fresh and process
Page 41 and 42: 30 Figure 18: Australian exports of
Page 43 and 44: 32 a typical year, an oversupply of
Page 45 and 46: 34 5.10 Price structure The graphs
Page 47 and 48: 36 6.0 Global competition analysis
Page 49 and 50: 38 7.0 Market opportunities and cha
Page 51 and 52: 40 8.0 Appendix 1—Product varieti
Page 53 and 54: 42 According to industry, the varie
Page 55 and 56: 44 4. How much seed do you plant an
Page 57 and 58: 46 iii) How much did you supply of
Page 59 and 60: 48 8. What are the key issues impac
Page 61 and 62: 50 Raw Ginger Processed Ginger Ging
Page 63 and 64: 52 9.3 Wholesaler’s questionnaire
Page 65 and 66: 54 7. How do you promote and market

The Australian ginger industry - Department of Primary Industries

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